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1.- Plan assets are long-lived, tangible assets used in the operation of a bussiness.

True

False

2. When an inventory overstatement in in year one counter balances in year two, this means:

a) A prior period adjustemnt is record if the error is discovered in year two.

b) Aprior period adjustment is recorded if the error is discovered in year three,

c) The year one balance sheeet does not need to berestated if the error is discovered in year three.

d) There are not reporting errors, even if the overstatement is vever discovered.

3) A depreciable asset has a estimated 15% salvage value. Under which of the following methods, properly applied, would the accumulated depreciation equal the original cost at the end of the assets estimated usefullife?

Straigt-line Double Decline balance

a) Yes No

b) No Yes

c) No No

d) Yes Yes

Question 4 Not vet answered Marked out of 4.00 On December 1, 2005, East Co. purchased a tract of land as a factory site for $300,000. The old building on the property was razed and salvaged materials resulting from demolition were sold Additional costs incurred and salvage proceeds realized during December 2005 were as follows: Flag question Cost to raze old building Legal fees for purchase contract and to record ownership Title guarantee insurance Proceeds from sale of salvaged materials $25,000 5,000 6,000 4,000 In East's December 31, 2005 Balance Sheet, what amount should be reported as land? Select one A. $321,000 OB. $336,000 0 C. $311 ,000 OD. $332,000

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